Insurance Funds

If you are injured on the job, who would take care of your medical costs? Who would provide short-term income in the event that your on-the-job injuries made it impossible for you to work while you recover?

In many states, state insurance funds have been established to provide money for workers' compensation claims. In the event that you are injured on the job, these insurance funds would provide the coverage you need for medical expenses and may provide a settlement amount if it is warranted by your circumstances.

Some insurance funds are the sole source of workers' compensation insurance in a state. Other states have a primary or secondary source of workers' compensation insurance in addition to state insurance funds. The remainder of the states do not maintain state insurance funds at all.

The biggest benefit of insurance funds is that they centralize the operations of workers' compensation claims. They take some of the uncertainty out of the process for employers and employees alike, which is a definite advantage over states that offer only private workers' compensation insurance.

The policies and procedures involved in enrolling in workers' compensation policies funded state insurance funds vary by location. In general, the employer enrolls in the plan and is given a premium that reflects the number of employees, the age of the business, and the company's safety record. Companies with a higher historical incidence of accidents are usually subject to higher premiums. However, some state insurance funds don't differentiate between high and low accident employers.

Usually, since insurance funds are non-profit entities, any money that is left over after a fiscal period ends is returned to policy holders in the form of dividends. This means that state insurance funds are not only a great source of reliable coverage, but often the most economical choice as well.